AMN Healthcare Announces Fourth Quarter and Full Year 2009 Results
SAN DIEGO, March 4 /PRNewswire-FirstCall/ -- AMN Healthcare Services, Inc. (NYSE: AHS) today announced operating results for the fourth quarter and full-year 2009. Financial highlights are as follows:
(Dollars in millions, except per share amounts)
Full
Q4 % Chg % Chg Year % Chg
2009 Q4 2008 Q3 2009 2009 2008
---- ------- ------- ----- -----
Revenue $144.7 (51%) (13%) $759.8 (38%)
------- ------ ----- ----- ------ -----
Gross Profit $41.2 (46%) (10%) $204.4 (36%)
------------ ----- ----- ----- ------ -----
Net Loss ($2.7) NM (36%) ($122.2) NM
-------- ----- --- ----- ------- ---
Loss per Share ($0.08) NM 33% ($3.75) NM
-------------- ------ --- --- ------ ---
Cash Flow from Operations $5.6 (60%) (71%) $98.7 55%
------------------------- ---- ----- ----- ----- ---
Adjusted EBITDA* $10.7 (54%) 1% $56.8 (41%)
---------------- ----- ----- --- ----- -----
Adjusted Diluted EPS* ($0.02) NM NM $0.32 (69%)
--------------------- ------ --- --- ----- -----
* See notes (2) and (3) under "Supplemental Financial and Operating Data"
for a reconciliation of non-GAAP items.
NM – Not meaningful
"I'm certain most would agree that 2009 represented the most challenging year in the history of the healthcare staffing industry. The unprecedented rise in unemployment and severe economic contraction wreaked havoc and resulted in precipitous drops in demand volumes unlike any other time. However, amidst the turbulence, AMN took a proactive, disciplined and forward-looking approach to build stronger relationships with our customers and streamline our operating model and cost structure. These efforts have resulted in strong adjusted EBITDA margins, improved gross margins and a healthy balance sheet," said Susan R. Nowakowski, President and Chief Executive Officer of AMN Healthcare. "As we enter 2010, the industry is experiencing a period of stabilization, and AMN is poised to benefit from the managed services and preferred provider relationships we expanded over the past year, in addition to the operational synergies and agility we have achieved."
Full Year Business Highlights
- Streamlined operating model and cost structure to improve future operating leverage
- Reduced SG&A by $73 million (32%) over prior year
- Achieved 7.5% adjusted EBITDA margin despite sharp revenue decline
- Launched new corporate branding to rationalize and unify our portfolio of integrated services and brands
- Generated operating cash flow of $99 million, significantly paid down debt and increased cash balance
- Completed debt refinancing in December
For the fourth quarter of 2009, revenue was $145 million, a decrease of 51% from prior year and 13% from prior quarter. Fourth quarter revenue for the Nurse and Allied staffing segment was $74 million, a decrease of 64% from the same quarter last year and down 10% sequentially. The Locum Tenens staffing segment generated revenue of $63 million, a decrease of 18% from prior year and 17% from prior quarter. Fourth quarter Physician Permanent Placement revenue was $8 million, a decrease of 32% from prior year and 5% from prior quarter.
For the full year 2009, revenue was $760 million, a decrease of 38% from prior year. Nurse and Allied staffing segment revenue was $431 million, a decrease of 49% from prior year, Locum Tenens staffing segment revenue was $292 million, a decrease of 9% from prior year, and Physician Permanent Placement segment revenue was $37 million, a decrease of 28% from prior year.
Gross margin in the fourth quarter of 2009 was 28.4%, an increase of 270 bps from prior year and an increase of 100 bps compared to the previous quarter, driven primarily by an increase in gross margin in the Nurse and Allied segment. Full year gross margin was 26.9%, as compared to 26.0% for prior year due to the Locum Tenens and Physician Permanent Placement segments representing a greater portion of our business mix, along with increases in gross margin across all business segments.
Selling, general and administrative ("SG&A") expenses for the fourth quarter of 2009 were 22% as a percentage of revenue compared to 19% in the same quarter last year. For the full year, SG&A expenses (excluding restructuring costs of $11.3 million) were 21% as a percentage of revenue, as compared to 19% for 2008. Fourth quarter SG&A declined by $23 million, or 41%, over the same period in the prior year, and sequentially by $5 million, or 12%, due largely to cost-saving initiatives taking hold.
The fourth quarter tax provision reflects a true-up of the effective state tax rates, which reduced the full year 2009 effective income tax benefit rate from 28% reported in the third quarter to 26%. This had the impact of reducing the full year 2009 income tax benefit to $43 million, as compared to income tax expense of $27 million for prior year, reflecting effective income tax rates of 26% and 44% for these periods, respectively. The year-over-year change in the effective income tax rate was primarily attributable to the goodwill impairment charges recorded during 2009, a portion of which were permanently nondeductible for tax purposes.
For the fourth quarter, the company recorded a GAAP loss per share of $0.08 which includes $0.06 related to debt refinancing charges. Full year GAAP loss per share was $3.75, including the negative impacts of $3.78 for impairment charges, $0.21 for restructuring charges, and $0.02 for non-recurring legal expenses, in addition to the $0.06 for refinancing related charges. Average shares outstanding for the fourth quarter and full year 2009 were 32.6 million.
As of December 31, 2009, cash and cash equivalents totaled $27 million, compared to $11 million as of December 31, 2008. On December 23, 2009, the company entered into a new credit agreement, which includes a $40.0 million secured revolving credit facility maturing in December 2012 and a $110.0 million secured term loan maturing in December 2013. As of December 31, 2009, total term debt outstanding, net of discount, was $106 million, with zero outstanding on the revolver.
Business Trends and Outlook
During the fourth quarter and going into the first quarter, Nurse and Allied traveler count began to show consistent, modest week-over-week increases, and demand was above prior year levels. In Locum Tenens, volume and demand experienced declines going into the fourth quarter, but future demand appears to have stabilized since November. In Physician Permanent Placement, fourth quarter search activity was sequentially lower, in line with typical seasonal trends. Despite the stabilizing trends across the business segments, overall demand is still at relatively low levels. The primary drivers continuing to constrain demand remain the high national unemployment rate, continued overall economic weakness, and stagnant admissions levels. Based on these factors, first quarter consolidated revenue is expected to be flat compared with the prior quarter. As we look at the sequential revenues and volumes in each of our three segments, Nurse & Allied appears to be the strongest with slight sequential growth expected, and the other business lines are projected to be flat to slightly down sequentially.
"While the trajectory of the recovery continues to be difficult to predict, we believe that our comprehensive breadth of service offerings, our stronger client contractual relationships and operational agility leave AMN poised to capture market share and deliver better profitability as the trends improve," added Nowakowski. "In addition, with our healthy balance sheet and recent debt refinancing, the company is well-positioned to focus on building future growth through long-term strategic investments in new synergistic opportunities to expand and diversify our business."
About AMN Healthcare Services
AMN Healthcare Services, Inc. is the nation's leading provider of comprehensive healthcare staffing and management services. As a leading provider of travel nurse and allied staffing services, locum tenens (temporary physician staffing) and physician permanent placement services, AMN Healthcare recruits and places healthcare professionals on assignments of variable lengths and in permanent positions with clients throughout the United States, who range from acute-care hospitals and physician practice groups to other healthcare settings, including rehabilitation centers, dialysis clinics, pharmacies, home health service providers and ambulatory surgery centers. For more information, visit http://www.amnhealthcare.com.
Conference Call on March 4, 2010
AMN Healthcare Services, Inc.'s fourth quarter 2009 conference call will be held on Thursday, March 4, 2010, at 5:00 p.m., Eastern Time. A live webcast of the call can be accessed through AMN Healthcare's website at http://www.amnhealthcare.com/investors. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio software. Interested parties may participate live via telephone by dialing (800) 230-1059 in the U.S. or (612) 288-0337 internationally. Following the conclusion of the call, a replay of the webcast will be available at the company's website. Alternatively, a telephonic replay of the call will be available at 7:00 p.m. Eastern Time on March 4, 2010, and can be accessed until 11:59 p.m. Eastern Time on March 18, 2010, by calling (800) 475-6701 in the U.S. or (320) 365-3844 internationally, with access code 144662.
Non-GAAP Measures
This earnings release contains certain non-GAAP financial information. These measures are not in accordance with, or an alternative to, generally accepted accounting principles in the United States ("GAAP"), and may be different from non-GAAP measures reported by other companies. From time to time, additional information regarding non-GAAP financial measures may be made available on the company's website at http://www.amnhealthcare.com/investors.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include expectations regarding first quarter revenue and stabilizing demand trends, as well as Ms. Nowakowski's comments concerning the Company's positioning to capture market share, deliver better profitability, and build future growth through long-term strategic investments. The company based these forward-looking statements on its current expectations and projections about future events. Actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as "believe," "anticipate," "expect," "intend," "plan," "will," "may" and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Factors that could cause actual results to differ from those implied by the forward-looking statements contained in this press release are set forth in the company's Annual Report on Form 10-K for the year ended December 31, 2008 and its other quarterly and periodic reports filed with the SEC. These statements reflect the company's current beliefs and are based upon information currently available to it. Be advised that developments subsequent to this press release are likely to cause these statements to become outdated with the passage of time.
AMN Healthcare Services, Inc.
Condensed Consolidated Statements of Operations
(dollars in thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2009 2008 % Chg 2009 2008 % Chg
---- ---- ----- ---- ---- -----
Revenue $144,698 $295,902 (51.1%) $759,790 $1,217,200 (37.6%)
Cost of revenue 103,545 219,966 (52.9%) 555,369 900,211 (38.3%)
Gross profit 41,153 75,936 (45.8%) 204,421 316,989 (35.5%)
28.4% 25.7% 26.9% 26.0%
Operating expenses:
Selling, general
and
administrative 32,388 55,176 (41.3%) 157,241 230,656 (31.8%)
22.4% 18.6% 20.7% 18.9%
Depreciation and
amortization 3,408 3,581 (4.8%) 13,812 14,439 (4.3%)
Restructuring
charges - - 0% 11,270 - 100%
Impairment charges - - 0% 175,707 - 100%
Total operating
expenses 35,796 58,757 (39.1%) 358,030 245,095 46.1%
------ ------ ------- -------
Income (loss) from
operations 5,357 17,179 (68.8%) (153,609) 71,894 NM
3.7% 5.8% (20.2%) 5.9%
Interest expense, net 5,373 2,669 101.3% 11,955 10,690 11.8%
Income (loss) before
income taxes (16) 14,510 (100.1%) (165,564) 61,204 NM
Income tax expense
(benefit) 2,706 6,886 (60.7%) (43,387) 26,847 NM
----- ----- ------- ------
Net income (loss) $(2,722) $7,624 NM $(122,177) $34,357 NM
======= ====== ========= =======
(1.9%) 2.6% (16.1%) 2.8%
Net income (loss) per
common share:
Basic $(0.08) $0.23 NM $(3.75) $1.03
====== ===== ====== ===== NM
Diluted $(0.08) $0.23 NM $(3.75) $1.02
====== ===== ====== ===== NM
Weighted average
common shares
outstanding:
Basic 32,631 32,575 0.2% 32,615 33,375 (2.3%)
Diluted 32,631 32,870 (0.7%) 32,615 33,811 (3.5%)
NM – Not meaningful
AMN Healthcare Services, Inc.
Supplemental Financial and Operating Data
(dollars in thousands, except operating data)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2009 % of 2008 % of 2009 % of 2008 % of
Rev Rev Rev Rev
Revenue
Nurse and allied
healthcare
staffing $73,999 $207,313 $431,126 $843,747
Locum tenens
staffing 62,447 76,413 291,822 321,954
Physician
permanent
placement
services 8,252 12,176 36,842 51,499
$144,698 $295,902 $759,790 $1,217,200
======== ======== ======== ==========
Reconciliation
of Non-
GAAP Items:
Segment
Operating
Income(1)
Nurse and
allied
healthcare
staffing $7,686 10.4% $19,502 9.4% $38,076 8.8% $85,470 10.1%
Locum tenens
staffing 6,459 10.3% 6,883 9.0% 28,814 9.9% 25,951 8.1%
Physician
permanent
placement
services 1,942 23.5% 3,533 29.0% 9,819 26.7% 15,375 29.9%
----- ----- ----- ------
16,087 11.1% 29,918 10.1% 76,709 10.1% 126,796 10.4%
Unallocated
corporate
overhead 5,374 6,767 19,936 31,141
----- ----- ------ ------
Adjusted
EBITDA(2) 10,713 7.4% 23,151 7.8% 56,773 7.5% 95,655 7.9%
Depreciation
and
amortization 3,408 3,581 13,812 14,439
Stock-based
compensation 1,948 2,391 8,709 9,322
Restructuring
charges - - 11,270 -
Impairment
charges - - 175,707 -
Unallocated
non-
recurring
legal
expenses - - 884 -
Interest
expense,
net 5,373 2,669 11,955 10,690
----- ----- ------ ------
Income
(loss)
before
income
taxes (16) 14,510 (165,564) 61,204
Income tax
expense
(benefit) 2,706 6,886 (43,387) 26,847
Net income
(loss) $(2,722) $7,624 $(122,177) $34,357
======= ====== ========= =======
GAAP based
diluted
net income
(loss)
per share
(EPS) $(0.08) $(3.75)
Adjustments: -
Restructuring
charges - 0.21
Non-
recurring
legal
expenses - 0.02
Impairment
charges - 3.78
Refinancing
related
charges 0.06 0.06
Adjusted
diluted
earnings
per
share(3) $(0.02) $0.32
Three Months Ended Twelve Months Ended
December 31, December 31,
2009 2008 % Chg 2009 2008 % Chg
Gross Margin
Nurse and
allied
healthcare
staffing 27.0% 23.6% 24.4% 23.9%
Locum tenens
staffing 26.0% 26.0% 26.4% 26.3%
Physician
permanent
placement
services 60.0% 58.7% 59.6% 59.4%
Operating Data:
---------------
Nurse and
allied
healthcare
staffing
Average
travelers
on
assignment(4) 2,396 6,865 (65.1%) 3,562 7,036 (49.4%)
Revenue per
traveler
per day(5) $335.70 $328.25 2.3% $331.60 $327.65 1.2%
Gross
profit per
traveler
per day(5) $90.52 $77.41 16.9% $81.06 $78.34 3.5%
Locum tenens
staffing
Days
filled(6) 43,276 53,145 (18.6%) 203,413 222,341 (8.5%)
Revenue per
day
filled(6) $1,442.99 $1,437.82 0.4% $1,434.63 $1,448.02 (0.9%)
Gross
profit per
day
filled(6) $375.55 $374.37 0.3% $378.86 $380.68 (0.5%)
As of December 31,
2009 2008
Leverage Ratio(7) 1.9 1.5
(1) Segment Operating Income represents net income (loss) plus
interest expense (net of interest income), income taxes,
depreciation and amortization, restructuring charges, impairment
charges, non-recurring legal expenses, unallocated corporate
expenses, and stock-based compensation expense. Management believes
that Segment Operating Income is an industry wide financial measure
that is useful both to management and investors when evaluating the
company's performance. Management also uses Segment Operating Income
for planning purposes. Segment Operating Income is not necessarily
comparable to other similarly titled captions of other companies due
to potential inconsistencies in the method of calculation and
allocation of costs.
(2) Adjusted EBITDA represents net income (loss) plus interest expense
(net of interest income), income taxes, depreciation and
amortization, restructuring charges, impairment charges, non-
recurring legal expenses, and stock-based compensation expense.
Management presents adjusted EBITDA because it believes that
adjusted EBITDA is a useful supplement to net income as an indicator
of operating performance. Management believes that adjusted EBITDA
is an industry wide financial measure that is useful both to
management and investors when evaluating the company's performance.
Management also uses adjusted EBITDA for planning purposes.
Management uses adjusted EBITDA to evaluate the company's
performance because it believes that adjusted EBITDA provides an
effective measure of the company's results, as it excludes certain
items that management believes are not indicative of the company's
operating performance and considers measures used in credit
facilities. However, adjusted EBITDA is not intended to represent
cash flows for the period, nor has it been presented as an
alternative to income (loss) from operations or net income (loss) as
an indicator of operating performance, and it should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. As defined, adjusted
EBITDA is not necessarily comparable to other similarly titled
captions of other companies due to potential inconsistencies in the
method of calculation. While management believes that some of the
items excluded from adjusted EBITDA are not indicative of the
company's operating performance, these items do impact the income
statement, and management therefore utilizes adjusted EBITDA as an
operating performance measure in conjunction with GAAP measures such
as net income.
(3) Adjusted diluted earnings per share represents GAAP EPS plus
restructuring and impairment charges, non-recurring legal expenses
and refinancing related charges. The per share adjustments used in
the adjusted EPS calculation are net of the Company's estimated
statutory tax rate. Management presents adjusted EPS because it
believes that adjusted EPS is a useful supplement to diluted net
loss per share as an indicator of operating performance. Management
believes such a measure provides a picture of the company's results
that is more comparable among periods since it excludes the impact
of items that may recur occasionally, but tend to be irregular as to
timing, thereby distorting comparisons between periods. However,
investors should note that this non-GAAP measure involves judgment
by management (in particular, judgment as to what is classified as a
special item to be excluded from adjusted EPS). As defined, adjusted
EPS is not necessarily comparable to other similarly titled captions
of other companies due to potential inconsistencies in the method of
calculation. While management believes that some of the items
excluded from adjusted EPS are not indicative of the company's
operating performance, these items do impact the income statement,
and management therefore utilizes adjusted EPS as an operating
performance measure in conjunction with GAAP measures such as GAAP
EPS.
(4) Average travelers on assignment represents the average number of
nurse and allied healthcare professionals on assignment during the
period presented.
(5) Revenue per traveler per day and gross profit per traveler per day
represent the revenue and gross profit of the company's nurse and
allied healthcare staffing segment divided by average travelers on
assignment, divided by the number of days in the period presented.
(6) Days filled is calculated by dividing the locum tenens hours filled
during the period by 8 hours. Revenue per day filled and gross
profit per day filled represent revenue and gross profit of the
company's locum tenens staffing segment divided by days filled for
the period presented.
(7) Leverage ratio represents the ratio of the total debt outstanding at
the end of the period to the Adjusted EBITDA for the past twelve
months.
AMN Healthcare Services, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
December 31, September 30, December 31,
2009 2009 2008
Assets
Current assets:
Cash and cash equivalents $27,053 $22,621 $11,316
Accounts receivable, net 89,498 96,410 182,562
Prepaid expenses 6,550 6,748 9,523
Income taxes receivable 3,900 2,108 3,440
Deferred income taxes, net 8,534 17,805 18,085
Other current assets 1,902 2,782 4,901
----- ----- -----
Total current assets 137,437 148,474 229,827
Restricted cash and cash
equivalents 22,025 - -
Fixed assets, net 19,970 21,581 24,018
Deposits and other assets 14,368 12,488 13,252
Goodwill 79,868 79,868 252,875
Intangible assets, net 115,336 116,537 122,845
------- ------- -------
Total assets $389,004 $378,948 $642,817
======== ======== ========
Liabilities and stockholders'
equity
Current liabilities:
Bank overdraft - - $3,995
Accounts payable and accrued
expenses 18,057 18,929 24,420
Accrued compensation and
benefits 24,054 29,431 44,871
Revolving credit facility - - 31,500
Current portion of notes
payable 5,500 10,845 14,580
Deferred revenue 5,084 5,404 7,184
Other current liabilities 10,404 14,502 14,722
------ ------ ------
Total current liabilities 63,099 79,111 141,272
Notes payable, less current
portion and discount 100,121 66,425 100,236
Deferred income taxes, net 789 4,615 58,466
Other long-term liabilities 54,151 57,277 58,710
------ ------ ------
Total liabilities 218,160 207,428 358,684
------- ------- -------
Stockholders' equity 170,844 171,520 284,133
------- ------- -------
Total liabilities and
stockholders' equity $389,004 $378,948 $642,817
======== ======== ========
AMN Healthcare Services, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31, December 31, December 31,
2009 2008 2009 2008
---- ---- ---- ----
Net cash
provided by
operating
activities $5,582 $13,802 $98,732 $63,694
Net cash used
in investing
activities (22,887) (1,819) (29,245) (48,247)
Net cash
provided
(used in)
financing
activities 21,721 (8,296) (53,810) (22,334)
Effect of
exchange
rates on cash 16 (176) 60 (292)
---- ---- --- ---
Net increase
(decrease) in
cash and
cash
equivalents 4,432 3,511 15,737 (7,179)
Cash and cash
equivalents at
beginning
of period 22,621 7,805 11,316 18,495
------ ----- ------ ------
Cash and cash
equivalents at
end of
period $27,053 $11,316 $27,053 $11,316
======= ======= ======= =======
Contact: |
|
Amy C. Chang |
|
Vice President, Investor Relations |
|
866.861.3229 |
|
(Logo: http://www.newscom.com/cgi-bin/prnh/20060718/LATU121LOGO)
SOURCE AMN Healthcare Services, Inc.
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